Veriscope Weekly Regulatory Recap: September 19 to September 26
Welcome to another edition of Veriscope Regulatory Recap! A lot to cover this week, from Indonesia’s plan to turn on the heat against crypto exchanges to the US Treasury’s open call for public comments on crypto regulations. So, without further ado, let’s dive straight into it.
Indonesia Introduces New Stricter Rules for Crypto Exchanges
Indonesia is preparing to tighten the regulation of digital asset exchanges, officials from the country’s Minister of Trade and the Commodity Futures Trading Regulatory Agency (Bappebti) said at a parliamentary hearing in Jakarta.
Under the revised regulatory framework, two-thirds of directors on digital trading platforms must be Indonesian citizens residing in the country.
“That way, at least we can prevent the top management from fleeing the country if any problem arises,” Didid Noordiatmoko, acting head of Bappebti, told parliament.
Crypto exchanges will also be required to use a third party to store client funds and prohibited from re-investing stored crypto assets.
Deputy Minister of Trade Jerry Sambuaga said Bappebti would be issuing new rules soon but didn’t give a specific timeframe.
He also confirmed that the government is still planning to launch a crypto bourse, which has been delayed several times this year.
EU Finalizes Legal text for Crypto Regulations, Covering Stablecoins & NFT
The European Union has reportedly finalized the full text of its Markets in Crypto Assets (MiCA) legislation, although it is still open to comments.
Once passed into law, MiCA will require crypto issuers to publish white papers, including technical roadmaps, stablecoin issuers to hold capital and be prudently managed, and platforms to register with the authorities.
The latest draft of the bill also covers algorithmic stablecoins, which were previously excluded from MiCA’s scope when it was first introduced in 2020.
The reason behind it is pretty apparent. Algorithmic stablecoins have gained notoriety since TerraUSD (UST) lost its peg to the US dollar, bringing Terra’s entire ecosystem to its knees, with Luna’s value dropping by almost 90%.
This is why the draft highlights that algorithmic stablecoins should fall within the scope of regulation “irrespective of how the issuer intends to design the crypto asset, including the mechanism to maintain a stable value.”
When it comes to NFTs, the draft says, the issuance of “non-fungible tokens in a large series or collection should be considered as an indicator of their fungibility.”
The UK Introduces New Law to Seize, Freeze, and Recover Crypto Assets
The UK has introduced the Economic Crime and Corporate Transparency Bill to make it easier and quicker for law enforcement agencies to seize, freeze, and recover crypto assets when used for criminal activities.
The 250-page bill, first promised in May, builds on an earlier Economic Crime Act that helped regulators place sanctions on Russia and covers more than just crypto.
“Domestic and international criminals have for years laundered the proceeds of their crime and corruption by abusing U.K. company structures and are increasingly using cryptocurrencies,” said director general of the National Crime Agency, Graeme Biggar, in a statement.
“These reforms — long-awaited and much welcomed — will help us crack down on both.”
US Treasury Seeks Public Comment on Crypto Regulation
The US Treasury Department has invited the public to comment on how digital assets are used in illegal activities and how the government should respond to them.
It listed over 20 questions covering CBDC, the risks posed by NFTs, and what the government can do to prevent crimes related to DeFi.
“The growing use of digital assets in financial activity heightens risks of crimes such as money laundering, terrorist and proliferation financing, fraud and theft schemes, and corruption,” states the document.
“These illicit activities highlight the need for ongoing scrutiny of the use of digital assets, the extent to which technological innovation may impact such activities, and exploration of opportunities to mitigate these risks through regulation, supervision, public-private engagement, oversight, and law enforcement.”
Important Announcement: 10,000 SHFT on Offer!
After Shyft DAO approved the Veriscope VASP grant proposal, an aggregate of 10,000 SHFT has been granted for Virtual Asset Service Providers (VASPs) that integrate into the Veriscope mainnet by September 30, 2022.
The fund will enable VASPs to pay the Shyft Network gas fees while using Veriscope. This offer will remain valid until December 31, 2022, or till the VASP exhausts its SHFT grant.
Meet us at Token2049!
Shyft Network’s Head of Strategy, Malcolm Wright, will be attending Token2049 on September 29 at 9:15 AM. Come talk to us on all things crypto regulations, particularly the Travel Rule. Drop us a line at https://www.veriscope.network/contact to set up a time.
VASPs need a Travel Rule Solution to begin complying with the FATF Travel Rule. So, have you zeroed on it yet? We have the best solution to suggest: Veriscope! Veriscope is the only frictionless Crypto Travel Rule compliance solution.
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